Determine Non-Controlling Interest as of December 31, 2018 On January 1, 2018, Parent Company purchased 80% of the outstanding shares of Subsidiary Company for P800,000. On the date of acquisition,Subsidiary Company reported Ordinary Shares of P800,000 and Retained Earnings of P200,000. Subsidiary's Inventory was understated by P20,000;Equipment with a 5-year life was understated by P20,000, Building with an 8-year life was understated by P80,000 and land was understated byP40,000. The non-controlling interest is to be stated at fair value and the fair value of the non-controlling interest on January 1, 2018 is P210,000.The following are taken from the books of Parent and Subsidiary for 2018.ParentSubsidiarySales2,000,0001,500,000Gross Profit550,000350,000Net Income200,000150,000Dividend Declared (to be paid on Jan 15, 2019)100,00050,000Total Assets5,000,0004,000,000From the data above, determine: Non-contrlling Interest as of December 31, 2018.

Non Controlling interest will be enthusiasm for an organization whereby the organization claims…

Answered: of December 31

Business

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Determine Non-Controlling Interest as of December 31, 2018

On January 1, 2018, Parent Company purchased 80% of the outstanding shares of Subsidiary Company for P800,000. On the date of acquisition,
Subsidiary Company reported Ordinary Shares of P800,000 and Retained Earnings of P200,000. Subsidiary's Inventory was understated by P20,000;
Equipment with a 5-year life was understated by P20,000, Building with an 8-year life was understated by P80,000 and land was understated by
P40,000. The non-controlling interest is to be stated at fair value and the fair value of the non-controlling interest on January 1, 2018 is P210,000.
The following are taken from the books of Parent and Subsidiary for 2018.
Parent
Subsidiary
Sales
2,000,000
1,500,000
Gross Profit
550,000
350,000
Net Income
200,000
150,000
Dividend Declared (to be paid on Jan 15, 2019)
100,000
50,000
Total Assets
5,000,000
4,000,000
From the data above, determine: Non-contrlling Interest as of December 31, 2018.

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